29 August 2018

Our tiny power bill and solar panels

Recently there was some uproar about a Stuff article featuring a couple who have an electricity bill of $70 a month in winter thanks to cooking over a wood burner fueled with foraged wood, and taking sponge baths. Some of the readers' comments are fascinating - I'll paste a few below.

We have even lower bills - around $85 for our family of four, including gas hot water and its dastardly fixed monthly fee of around $35 a month.

I've scribbled out. our home address. Note that this bill is for two months.

We achieve it by a combination of things that you might be interested in.

I am a firewood forager

Our 2002 Mazda Atenza works hard for us.

I had to laugh yesterday when I was loading up our own aged station wagon with foraged wood! I was just like the Stuff couple. I'd walked past someone felling a tree in our neighbourhood, and, as usual, asked if they had someone who wanted the firewood. They spoke little English, so it took a bit of gesturing, but two hours later the wood was on our property, and I'd got to move my body well.

Most of it was already cut up to perfect sizes for our woodburner. We're used to such luxury, though - every so often a tree crew that doesn't want to pay for dump fees drops off a load of pre-cut wood onto a our driveway! I asked them for it one day, and they keep on giving. The hardest part was being brave enough to ask.

Sadly, yesterday's tree was a lovely native tanekaha. I would prefer it to still be standing.

We dry the wood for a couple of years, then feeds this lovely thing.

I cook over it sometimes, but mostly use the kitchen. We heat a lot of water on it for dishes and hot water bottles in winter. We have a fancy system (a DVS reclaim) that transfers some of the fire's heat to the rest of the house, while also mostly eliminating our household condensation. It's great.

Unlike the Stuff couple, we have real showers and baths, and run a dishwasher.

We really like the extra exercise we get from the firewood, believing strongly that a sedentary western lifestyle is bad in many ways, including environmental. He who choppeth wood is twice-warmed, says the proverb. I will add that so is she who lifts wood into the car, then into the wheelbarrow, then pushes it around the back of the house and tips it out.

Anyone who thinks this is caveman living (see comments below) is seriously under-educated about how humans lived for almost all of our history. I drove it home in a car, and someone had cut it down for me with a chainsaw, and I had a sturdy plastic wheelbarrow to shift it, and there may even be a chainsaw involved in cutting the big pieces (although I doubt it - we have an axe and muscles).

Although, as we soak up the heat of the fire on a winter night, gazing at the flames, we feel happily cavemanish.

Some family members love the fire more than others. Our small grey lion is a true fan.

Our solar panels

We pinch the sun's energy not only via burning trees, but more directly. Nearly four years ago we got 12 rootftop photovoltaic
panels. These are tied to the electricity grid, through which we export our
excess electricity and buy in electricity when we aren't producing enough to
cover our needs. I wrote my first post about them here.

I often hear even the greenest of people wondering whether
it's financially worth it to get some.

Sometimes, these same people are taking regular mid-winter
trips to somewhere nearer the equator. They might be willing to pay more for
organic food or other eco-friendly actions, but for some reason the solar
electricity option seems to require far more analysis about whether it will pay
for itself or, even better, bring financial returns.

How we make money from our panels (or feel like we do!)

In NZ, the electricity companies don't pay you much for the electricity you export to the grid. It's generally 7 to 10 cents per unit, whereas when you buy it in you pay three or four times as much as that.

But there are some things to remember that make the picture much brighter:

1. Use the electricity, don't export it.

The amount you'll see on your monthly electricity bill as a refund or negative amount, which accounts for the amount you exported, is only part of the bonus. This is because you only export your 'excess' electricity - in other words, the stuff you don't use as it's being generated.

The big savings come with every watt of electricity that you use as it's being generated. You do this by using every appliance you need, while the sun's shining (as long as you don't use too many at once). Each unit you use while the sun shines saves you buying in full-price electricity at 33 cents per unit, or whatever your rate is. This figure won't show up on your electricity bill, because your company won't know about it. You will be supplying your own electricity, and paying them not a single cent for it.

The upshot of this is that you are discounting your own electricity bill, and the saving is 100% per unit. This is where the real money-saving happens. It helps to have someone at home during the day, although these days many appliances can be set in advance to run.

Our PV panels got 'switched on' with Meridian in January 2015 - but the previous spring, our wood burner was installed, so we no longer use our heat pump. Therefore, we're not comparing apples with apples.

2. Exporting adds up when the sun is shining

When the sun shines, those clever panels make a LOT of electricity. They make far more than you are likely to be able to use as it's generated, so you will be exporting a lot to the grid. You might only be getting paid a quarter of what you'll pay to buy electricity at night, but because you're pouring so much of it down those power lines, it adds up.

The amount you'll be exporting on hot sunny days depends on how big a system you get. Ours is 3kW, not all of which can be generated at once because a quarter of our panels face west to grab the late afternoon sun to help with dinner time electricity demands for much of the year. For our exported electricity, we get a credit of about $20-$30 a month in summer, and $10 in winter (we have a 3 kW system).

Shop around for your provider(s)

It's really worth shopping around the electricity and gas companies, and this is a rapidly expanding field, with exciting new providers popping up regularly. Not all of them pay you for exported electricity, so that cuts out a few as potential options. In fact, I need to shop around again, in case there is now something better for us.

We were initially with Meridian. The export rate was about the same as the other providers, but then suddenly a sneaky little 'tax' came in, where they actually charged us something like 3 cents a unit for each unit we exported. This is a big deal when you're only receiving 7 to 10 cents per unit! It was a charge from WEL, not Meridian.

We moved to Contact, and while their export rates aren't much different (8 cents per unit), they don't pass on that charge. Our power bills (electricity plus gas) dropped dramatically. This is partly because they offer such a generous discount if you have both electricity and gas with them.

Now, for a family of four, our bills are around $80 year-round including gas, and incorporating our export earnings. But note our last Meridian charge, minus gas (this was post-solar):

And the gas is a big chunk. Here's a sample bill, this one from Contact. Contact has the most confusing bills I've ever come across, but the basics are that the monthly fixed gas charge is around $35, plus whatever you use. This bill is for two months, hence each item being mentioned twice:

I'm also tempted by Trustpower, who run a buddy scheme that involves pairing up with three or so other families and selling them your exported electricity at whatever price you agree between yourselves. You can supply your parents, for example, with at least a chunk of half-price electricity, and still be getting twice the price you're getting from your provider. (It's not actually your electricity they'll get, of course; it's just a financial exchange.)

But do we make money from our solar panels?

The set-up cost us $12,000, which is more than you'd pay now, and more than someone with a standard roof would have paid for the cheapest system four years ago.

In doing a rough calculation, let us ignore two factors that really should not be ignored if you truly want to crunch the numbers: the interest and/or dividends we could have earned if we'd invested the money instead, or the interest we'd pay if we had increased a mortgage to borrow the money. Oh, and then we could also count the interest on what we save by having lower power bills!

Without that messy interest calculation, the $12,000 can be spread out to $100 a month over ten years. Do we save that much? I don't know! This is because we had our wood burner installed just before the solar panels, so we simultaneously stopped using the heat pump and starting using solar electricity, and that muddied the calculation waters. I could probably do the calcs anyway, but I cannot be bothered, because:

1. We really, really like having our solar panels.
2. Once the theoretical pay-off period has finished, all our solar-generated electricity will be free.
3. If we sell our house and don't get to enjoy (2), we think the house will sell for a bit more because of the panels.

A couple of pre-solar bills from Meridian - which is only electricity, not gas - suggests that we are saving somewhere in that vicinity, depending on the time of year. Of course, it's all much rosier with Contact - but it might have been so without solar, too.

There is a whole lot more to be written about whether solar really does help the environment in a place like New Zealand with so much renewable energy. Maybe I'll write about that another day!

Selected reader comments from the Stuff article:

No fun living like a pauper. Life is too short92 square metre home! Living like my great grandparents used to live! You are welcome to it.

No fun living like a pauper. Life is too short

92 square metre home! Living like my great grandparents used to live! You are welcome to it.